New Report Suggests Seattle's Minimum Wage Hike May Actually be Hurting Workers


The study found that the number of jobs and hours worked declined among Seattle's lowest-paid workers after the city raised the minimum wage to $13 previous year. But opponents of the wage hike said raising the minimum pay that much would force employers to cut jobs, reduce hours or simply not hire new workers because they couldn't afford it.

On the whole, the study estimates, the average low-wage worker in the city lost $125 a month because of the hike in the minimum.

An expert on economic policies says a study on Seattle's minimum wage should serve as a reminder of an important trade-off.

Seattle was one of the first US cities to adopt a $15 minimum wage law, and its experience is being closely watched as other cities have followed suit and as advocates push for a higher federal minimum wage.

Fortunately the Pallister government in Manitoba has not adopted the $15-an-hour minimum wage policy that Ontario and Alberta are pushing. "The timing suggests it's the minimum wage", he added, not the natural effects of a growing economy.

Unlike the University of California study, the UW report examines low-wage workers across different sectors, not just restaurants, and was able to examine hours Seattle workers have worked since the 2016 increase took place. Does Seattle have answers?

"This strikes me as a study that is likely to influence people", said David Autor, an economist at the Massachusetts Institute of Technology who was not involved in the research.

For one thing, the researchers only took into account 62 percent of the jobs in Washington, excluding those jobs where the location could not be identified.

A number of newspapers across the country have reported on the working paper, including the Washington Post. "Many past studies, by contrast, have found that the benefits of increases for low-wage workers exceed the costs in terms of reduced employment - often by a factor of four or five to one". But Long did allow that his study's conclusions might be flawed: "If the areas we're picking to put weight on don't match what would have happened to Seattle in the absence of the minimum wage, our results would be potentially biased".

But Seattle's experience is nothing new.

Council Member Jacob Frey said he thinks small businesses should have more time than large businesses to phase in the wage increase. According to the study, low-wage earners made $125 per month less than they had before the higher wages kicked in. "In their place would be a significant increase in hours worked at somewhat higher-paying jobs".

© 2017 Seattle Times under contract with NewsEdge/Acquire Media.

"Seattle Mayor Ed Murray defended the minimum wage law, saying that 'businesses across the city are competing for employees and our city is in the midst of a period of almost unprecedented growth" The Seattle Times article states.